An Auckland employer is accused of exploiting migrant workers who claim they were not paid and were housed in city offices where they had no access to showers or a kitchen and were unable to leave at night.

Five complaints were yesterday lodged with the Employment Relations Authority against E-Advance Limited, a company which helps migrants find jobs.

It is alleged the company charged workers between $500 and $9000 to invest in it - a charge invoiced as "capital infusion" - with the understanding the money would be repaid as wages.

This is a scheme sometimes used by migrant workers as proof of employment to gain permanent residency. The employer returns the money to the workers and pays the tax portion to the Government.

However, it is alleged the company did not pay the salaries or taxes, causing "emotional and psychological stress" to the workers.

Norajane Colos, managing director of the company, says she has done "nothing wrong".

A lawyer representing the five employees yesterday handed a written complaint to the authority. Among the allegations are that two staff had been living in the company's level four office at Albert Plaza after they ran out of money to pay rent and food. Staff were also allegedly asked to provide misleading information to clients regarding the status of the company and their visa status was threatened.

The ERA complaint comes after the Labour Inspectorate began an investigation into the company after a meeting with its staff and their union representatives last week.

"I can confirm the inspectorate is investigating the company's systems and practices around compliance with employment standards and will take enforcement action in response to identified breaches," said inspectorate northern manager David Milne.

Ms Colos said she would co-operate with the investigation, but said the complainants had "begged" her for the jobs they needed to support their application for permanent residence, and were fully aware the sums they paid were not capital infusion but payment for training.

Related Content

Ms Colos denied she exploited her workers. "I was so naive, I trusted everyone. I was so open book and there is so much pain in my heart at the moment," she said.

Ms Colos also denied asking the two staff to live in the office and said she was the "last to find out".

The two staff, who have been living at the office for two months, told the Herald they had stayed there with the approval of Ms Colos, who told them they were not allowed to go out after 6pm because the building alarms were armed.

They said they had no access to a shower or kitchen, and survived on mainly fruit and instant noodles for dinner.

It was also alleged that employees were subjected to "various degrees of humiliation" - from abusive emails to being put down at staff meetings - if they did not work fulltime without pay.

Migrant workers union, Unemig, which alerted authorities to the workers' plight, described the allegations as "shocking".

Co-ordinator Dennis Maga said he was not aware of any previous cases where employees were found living in their employer's office.

"It's hard to believe such things still happen in modern-day New Zealand."

Mr Maga said this would be a "test case" for the new legislation to be introduced to combat migrant exploitation.

Immigration Minister Michael Woodhouse said in June that legislative changes would be introduced by this month to make it an offence to exploit migrants who hold temporary work visas, but a spokesman yesterday said it would still be three to four weeks away.

The proposed penalty was imprisonment for up to seven years, a fine not exceeding $100,000, or both.

Mr Maga believed the employer was also in breach of health and safety regulations, and possibly the building policy for using her office as staff accommodation.

Exploitation claims

*Had to pay a premium or capital infusion of up to $15,000 to secure employment.*Were not paid any wages, and pressured to loan further sums to the company.*Office in central Auckland commercial building turned into accommodation for those who ran out of money for rent.*No access to shower or kitchen and survived mainly on fruit and instant noodles.*Subjected to "various degrees of humiliation" if they did not work full time without pay.